U.S unemployment rate below 5%

  • The U.S economy added 151,000 jobs in January according to a provisional estimate. 
  • The unemployment rate was 4.9% (7.8 million people). 

  • While the figure for the first month of 2016 was solid, it did mark a slowdown in jobs growth compared to the final two months of 2015. 

  • Ahead of a monetary policy meeting in March, the Federal Reserve will have been watching this jobs report and last month's GDP report closely. 

  • Speaking at the White House, President Obama said the data showed the American economy was the 'strongest, most durable' in the world. *

  • Useful Resource: BLS jobs report


European Commission cuts growth forecast

  • The Euro area will grow 1.7% this year according to an updated forecast from the European Commission, down slightly on its previous prediction of a 1.8% expansion in GDP. 
  • The EC cited downside risks such as the slowdown in China and other emerging markets, while also warning that a 'more widespread' suspension of the Schengen principles, which allow free movement of people within the EU, would have a 'disruptive' impact on economic growth. 

  • Useful Resource: EC report


For the sixth consecutive month, activity in Chinese factories falls

  • Activity in Chinese factories, as measured by the official manufacturing purchasing managers index, declined once again in January. 

  • The manufacturing PMI has been below 50, which indicates contraction, since July. 

  • The January figure came in at 49.4, down from 49.7 in December. *

  • The non-manufacturing PMI, which measures activity in the services sector, fell 0.9 points from December to 53.4. 

  • Market reaction: The Shanghai Composite fell 1.78%.